The Board of Directors of Volkswagen has approved a program to cut 50,000 jobs
The Volkswagen Board of Directors has approved a program that provides for the cutting of up to 50,000 jobs.
The Board of Directors of Volkswagen has approved a program to cut 50,000 jobs. The company stated that this decision is linked to the plan of the group's CEO, Oliver Blume, to increase competitiveness amid pressure from Chinese manufacturers and US tariff policy.
Volkswagen reported that the number of models is planned to be reduced by approximately half. In addition, the company will review the operations of its plants in Emden, Zwickau, Hanover, and Neckarsulm. According to the company, excess production capacity exceeds the required level by about 500,000 vehicles.
The company reported that the reduction will affect about 50,000 jobs. Volkswagen also intends to simplify its management structure and decision-making process.
The government of Lower Saxony, which holds a stake in Volkswagen, also supported the program. The region's Prime Minister, Olaf Lies, stated that the company is facing serious difficulties and needs changes.
Volkswagen employs about 650,000 people. Earlier, the company reported a 30% decline in net profit for the first half of the year amid falling sales in China. The Volkswagen Group includes major brands Audi, Skoda, Porsche, and SEAT.